Setting Strategic Goals
How to set good strategic goals.
The role of goals in strategy
Goals are how we articulate strategic direction. They describe different aspects of where an organisation needs to go or to improve in order to be successful.
How we describe goals
The best goal statements tend to consist of a verb (an action word/phrase) followed by a noun (a word/phrase that describes a thing). For example:
- Increase(verb) customer sasfaction with after sales service(noun)
- Improve(verb) production line up time(noun)
Goals expressed in this way have the effect of commanding action to be taken.
Goals should also be directional and don't need to be measurable. They will be broken down into SMART (Specific, Measurable, Achievable, Relevant and Timebound) objectives later.
Using the Balanced Scorecard to set goals
We can use the Balanced Scorecard to help us set well-balanced and integrated goals.
The Balanced Scorecard advocates for setting goals across 4 perspectives:
- Financial: What success looks like financially (to owners)
- Customer: What success looks like to customers.
- Internal Business Processes: What internal business process performance must we achieve to be successful.
- Learning and Innovation: What do we need to do to be able to achieve the above on a sustainable basis.
The theory of the Balanced Scorecard is that success in each layer helps to achieve success in the layers above it. You can learn more about the Balanced Scorecard here.
Using TOWS to set goals
You can use the strategic insights on your SWOT Analysis to help you set strategic goals using the TOWS framework as follows:
- offensive goals (SO): use strengths to take advantage of opportunities.
- defensive goals (WO): choose opportunities which don't rely on capabilities which are weak.
- strengthening goals (ST): use strengths to minimise threats.
- survival goals (WT): minimise weaknesses and avoid threats.